DICGC Deposit Insurance if Your Bank Fails - citizen guide 2026

A cooperative bank in your town is suddenly put under RBI restrictions and you cannot withdraw your own fixed deposit. This is exactly the situation deposit insurance exists for. The Deposit Insurance and Credit Guarantee Corporation, a wholly owned subsidiary of the RBI, insures your bank deposits up to ₹5 lakh and can now pay you an interim amount within 90 days, even before the bank is wound up.

DICGC is a subsidiary of the Reserve Bank of India that insures deposits in banks. It covers savings, current, fixed, and recurring deposits held in commercial banks, small finance banks, payments banks, and most cooperative banks. The bank pays the premium, not you, so the cover is automatic on every insured deposit you hold up to the limit.

The governing law is the Deposit Insurance and Credit Guarantee Corporation Act 1961. The key features are:

1. Cover of ₹5 lakh: each depositor is insured up to ₹5 lakh in a bank, including both principal and interest. The limit applies per depositor per bank, in the same right and same capacity, and deposits across all branches of the same bank are added together.
2. Automatic cover: you do not buy the insurance or file any form in advance. The insured bank pays the premium to DICGC.
3. Interim payment within 90 days: the 2021 amendment inserted Section 18A, effective 1 September 2021. When the RBI imposes restrictions on a bank, such as All Inclusive Directions, DICGC must make an interim payment up to the ₹5 lakh cover within 90 days.

The 90-day clock works in stages. The bank under directions must furnish the depositor-wise list to DICGC within 45 days of the restrictions. DICGC verifies the claims within 30 days of receiving the list, and pays depositors within 15 days of completing verification, so the total time does not exceed 90 days. If the bank's licence is cancelled and it goes into liquidation, DICGC settles the insured amount through the liquidator.

RTI angle: The RBI is a public authority under the Right to Information Act 2005. If your bank is under directions and you are unsure of the status, an RTI to the RBI can confirm the date the directions were imposed and the action taken, while questions on your specific claim are best raised with the bank and DICGC. Knowing the date the restrictions started lets you track the 90-day interim payment window.

1. Confirm the bank's status. Check whether the RBI has placed it under directions or moratorium and note the date the order took effect.
2. Update your details with the bank. Make sure your KYC, mobile number, and consent for payment are current, as DICGC pays based on the list the bank submits.
3. Keep your deposit proofs ready: passbook, FD receipts, and account statements showing balances.
4. Track the 45-day list submission. The bank must send the depositor-wise claim list to DICGC within 45 days of the directions.
5. Watch for the interim payment. DICGC aims to pay up to ₹5 lakh within 90 days of the directions through the channel it announces.
6. If the bank is liquidated, follow the liquidator's process for the insured settlement.
7. Remember the limit is per bank. Spread large savings across different banks to stay within cover.

• Passbook or account statement showing your balance
• Fixed deposit and recurring deposit receipts
• Current KYC documents with the bank
• Updated mobile number and bank account for receiving payment
• Nominee or legal heir documents, where the depositor has died

• Assuming each branch has a separate limit. All deposits in one bank, across branches, are added together for the single ₹5 lakh cover.
• Keeping everything in one bank. Since the limit is per bank, large balances in a single bank above ₹5 lakh are not fully insured.
• Outdated KYC. DICGC pays based on the bank's list. Wrong contact or account details can delay your payment.
• Panic withdrawals through dubious agents. Deal only with the bank, DICGC, and official RBI notices, not middlemen who promise faster recovery for a fee.
• Ignoring nomination. A clear nominee speeds up settlement if the depositor dies during the process.

DICGC insures up to ₹5 lakh per depositor per bank, covering principal and interest together. Deposits in all branches of the same bank are added up for this single limit.

No. The cover is automatic on insured deposits, and the bank pays the premium. You do not buy a policy or file anything in advance to be covered.

Under Section 18A of the DICGC Act, when the RBI places a bank under directions, DICGC must make an interim payment up to ₹5 lakh within 90 days. The bank submits the depositor list within 45 days, and verification and payment follow.

It is per depositor per bank, in the same right and capacity. Multiple accounts in the same bank are combined, but deposits in different banks are each separately insured up to ₹5 lakh.

Yes. Most cooperative banks are insured by DICGC, along with commercial banks, small finance banks, and payments banks. You can confirm a bank's insured status from the DICGC website.

If the licence is cancelled and the bank goes into liquidation, DICGC pays the insured amount up to ₹5 lakh through the liquidator, who distributes it to depositors.

Because the cover is per bank, spreading large savings across different banks keeps more of your money within the insured limit. Within one bank, anything above ₹5 lakh is not fully insured.

• Deposit Insurance and Credit Guarantee Corporation Act 1961 and Section 18A - https://www.dicgc.org.in
• DICGC frequently asked questions on cover and claims - https://www.dicgc.org.in
• Reserve Bank of India - https://www.rbi.org.in
• Right to Information Act 2005 - https://rti.gov.in

• Draft an RTI to the RBI on a bank under directions
• File a first appeal if your RTI is ignored
• Raise your grievance with Awaaz RTI
• Read the RTI Act 2005 guide
• The RTI Playbook